To claim life insurance after someone dies, contact the insurance company that issued the policy, submit a certified death certificate along with the insurer’s claim form, and choose how you want the money paid. Proceeds paid to a named beneficiary are generally free of federal income tax, and most states require insurers to pay within 30 to 60 days of receiving complete paperwork. The process is straightforward when the policy is current and the beneficiary designation is clear. It gets slower when documents are missing, when the death falls inside the policy’s two-year contestability period, or when the cause of death is still under investigation.
Find the Policy
Before you can file anything, you need to know which company insured the person who died. Look through their financial records for premium notices, annual policy statements, or recurring automatic withdrawals on bank statements labeled with an insurer’s name. Call the human resources department at any current or former employer, since group life coverage through work is common and easy to overlook.
If nothing turns up, use the free Life Insurance Policy Locator run by the National Association of Insurance Commissioners. You submit the deceased person’s information from the death certificate and the request goes into a secure database that participating insurers search against their records.1National Association of Insurance Commissioners. NAIC Life Insurance Policy Locator Helps Consumers Find Lost Life Insurance Benefits The tool accepts the Social Security number, legal name, date of birth, and date of death.2National Association of Insurance Commissioners. Learn How to Use the NAIC Life Insurance Policy Locator It’s worth filing a request even if you think you already have everything, because people sometimes hold policies their families never knew about.
Gather the Documents
You will need a certified death certificate. Order copies from the local vital records office or the state department of health. Fees typically run from about $10 to $30 per copy, and you should order several at once because the insurer, banks, and other institutions each want their own original.
The insurer may also ask for the original policy document so it can close the contract. If you can’t locate it, most companies will accept a notarized lost policy affidavit instead. Have a government-issued photo ID ready to verify your identity as the beneficiary. Pulling all of this together before you contact the insurer keeps the claim from stalling on paperwork.
If the Death Certificate Says “Pending”
A death certificate that lists the cause or manner of death as “pending” is a common source of delay. This happens when the coroner or medical examiner is waiting on results such as toxicology reports. Insurers often put claims on hold in this situation and may request medical history, prescription information, and police or coroner reports. The investigation can run for months. Insurers cannot delay payment indefinitely without a reasonable basis, and the death certificate is not the only evidence they are allowed to consider. Supplying other documentation such as medical records and witness statements can sometimes break the holdup.
File the Claim
The insurer’s claim form, sometimes called a Statement of Claim, asks for the deceased’s full name, Social Security number, the policy number, and details about the date and circumstances of death. Information must match the death certificate exactly, so check it twice. Most insurers post the form for download on their websites.
You will also sign a W-9 so the insurer can report any taxable interest to the IRS. Enter your taxpayer identification number carefully, since errors on this form can trigger backup withholding on interest payments.3Internal Revenue Service. About Form W-9, Request for Taxpayer Identification Number and Certification
Many insurers now have secure online portals where you can upload everything and get an immediate confirmation. If you mail the package, send it certified with a return receipt so you have proof of delivery. Once the insurer has your complete submission, the processing window starts. Most states require insurers to pay within 30 to 60 days of receiving satisfactory proof of claim, and many impose interest penalties when they miss that deadline.4National Association of Insurance Commissioners. Claims Settlement Provisions Model Law Chart
Choose How the Money Is Paid
After the claim is approved, you decide how to receive the benefit. The three usual options are a lump sum, a retained asset account, or installment payments.
A lump sum sends the entire death benefit at once by check or direct deposit. It’s the simplest option and the most popular, and it puts the money fully in your control immediately.
A retained asset account keeps the funds with the insurer in something that looks and works like a checking account, accruing interest while you decide what to do. You can withdraw some or all of the money at any time. One point catches people off guard: these accounts are generally not FDIC insured, because they are insurance company products rather than bank deposits, even though they come with what looks like a checkbook. If the insurer becomes insolvent, your protection comes from state insurance guaranty associations, with coverage limits that vary by state.5Federal Deposit Insurance Corporation. Retained Asset Accounts and FDIC Deposit Insurance Coverage For a large benefit, moving the money to an FDIC-insured bank account promptly is the safer play.
An annuity or installment arrangement pays out the benefit in regular amounts over a set period, which can help with long-term budgeting.
What You’ll Owe in Taxes
The death benefit itself is almost always free of federal income tax. Federal law excludes life insurance proceeds received because of the insured person’s death from gross income.6Office of the Law Revision Counsel. 26 USC 101 – Certain Death Benefits A $500,000 payout arrives as $500,000, with no income tax owed on the principal.7Internal Revenue Service. Life Insurance and Disability Insurance Proceeds
Interest is the exception. Any interest that accumulates on the death benefit after the insured person died is taxable income. This includes interest earned during the insurer’s processing period and interest in a retained asset account. The insurer reports it on a Form 1099-INT, and you report it on your tax return like any other interest.7Internal Revenue Service. Life Insurance and Disability Insurance Proceeds
Estate tax is a separate question from income tax, and relevant only for very large estates. If the deceased owned the policy at death, the full death benefit is counted in the taxable estate for federal estate tax purposes.8Office of the Law Revision Counsel. 26 USC 2042 – Proceeds of Life Insurance For 2026, the federal estate tax exemption is $15,000,000 per individual.9Internal Revenue Service. What’s New – Estate and Gift Tax Someone with $12 million in other assets and a $5 million policy would cross that threshold; most families won’t.
When the Insurer Delays or Denies the Claim
Outright denials are not common, but they tend to fall into a few predictable categories, and knowing them helps you anticipate what the insurer is checking for.
The Two-Year Contestability Period
Every life insurance policy has a contestability period, almost always two years from the date the policy was issued. During that window, the insurer can investigate the original application and deny the claim if it finds a material misrepresentation, meaning something important enough that the insurer would have charged a higher premium or declined coverage altogether had it known. A wrong zip code is not material. Hiding a cancer diagnosis is. If the insured died within the first two years of the policy, expect a thorough medical records review before payment. After the two years pass, the insurer generally cannot challenge the claim based on application errors, though outright fraud can still be grounds for denial in some jurisdictions.
The Suicide Exclusion
Most policies exclude death by suicide within the first two years, though a handful of states have shortened that to one year. If the exclusion applies, the insurer typically refunds the premiums paid rather than paying the death benefit. After the exclusion period, the policy covers death by suicide the same as any other cause.
Lapsed Policies and Policy Exclusions
The most preventable reason for denial is a lapsed policy. If the insured stopped paying premiums and the grace period expired, coverage may have ended before the death. Insurers will also deny when the death falls under a specific exclusion written into the policy, such as death during the commission of a crime or certain hazardous activities. Always ask for a written denial letter stating the specific reason so you know exactly what you’re dealing with.
Appealing a Denial
Start with the insurer’s internal appeals process and gather evidence that addresses the stated reason for denial, such as medical records, autopsy reports, or proof of premium payments. If the internal appeal fails, you can file a complaint with your state’s department of insurance, which has regulatory authority over the insurer. For substantial benefits, especially in contestability or misrepresentation disputes where the legal arguments get technical, hiring an attorney who handles life insurance claims is worth considering.
If You’re Not Sure You’re the Beneficiary
Proceeds go to whoever is named as beneficiary on the policy, and that designation overrides the will. This trips up many families. If the deceased named an ex-spouse years ago and never updated the policy after remarrying, the ex-spouse receives the money in most states regardless of what the will says.
Policies usually allow a primary and a contingent beneficiary. If the primary beneficiary died before the insured, proceeds go to the contingent beneficiary. If no contingent is named and the primary is deceased, the benefit typically becomes payable to the estate and goes through probate. The same happens if the estate itself is named as beneficiary, or if no beneficiary was ever designated. Once proceeds land in the estate, they are distributed under the will or state intestacy laws, and they can be reached by the deceased’s creditors, which would not have happened had the money passed directly to a living named beneficiary.
When a living beneficiary is named, the payout bypasses probate entirely. The money moves directly from the insurer to the beneficiary, often within weeks of filing a complete claim, even while the rest of the estate is still working through the courts.